Renewable Fuel Standards

Emerging enforcement trends indicate that EPA and DOJ will continue to pursue cases involving fraud in the Renewable Fuel Standard (RFS) program. Although it is reasonable to assume the vast majority of program participants comply with EPA’s regulations, the program has suffered from high profile cases of fraud and abuse requiring federal enforcement, including criminal prosecutions. Recent cases and statements by DOJ and EPA officials show that federal prosecution of RFS fraud, particularly that involving multi-state schemes, will continue. And RFS fraud cases may even occupy a larger portion of EPA’s enforcement bandwidth as EPA gives greater deference to states in enforcement of state delegated programs.
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US EPA Administrator Pruitt signed a notice denying petitions to change the “point of obligation” under the RFS program. EPA stated that its “primary consideration” in reviewing the petitions was whether changing the point of obligation would improve the effectiveness of the RFS program to achieve Congress’s goals. EPA concluded that the petitioners did not meet that standard.
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Increased use of renewable fuels is a core element of our country’s quest for energy independence and has also been used to incentivize private efforts to reduce greenhouse gas emissions. Now more than ten years old, the Renewable Fuel Standard (RFS) program has helped make ethanol made from sugarcane and compressed natural gas produced from sludge at municipal wastewater treatment facilities common household concepts. While the vast majority of renewable fuel producers are compliant, the program has suffered from high-profile cases of fraud and abuse requiring federal enforcement, including criminal prosecutions.
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